APEC to study impact of state-owned oil firms

Asia-Pacific Economic Cooperation energy ministers plan to study the impact of state ownership of oil and gas companies on trade and investment, according to a draft communique.

The 21-member body, including China, the U.S. and Russia, will set up a working group to assess how to cooperate with state-owned companies, according to the draft statement obtained by Bloomberg News in advance of the final communique later today.
Ministers from APEC, which accounts for 60 percent of global oil and gas demand, are meeting in Darwin, Australia, to discuss energy security and minimizing harmful emissions. The group’s dependency on oil imports is set to rise at a time when governments led by Russia and Venezuela are seizing oil assets from private companies.

“It’s a problem that private, international oil companies find it difficult to develop reserves,” Claude Mandil, the International Energy Agency’s executive director, said in an interview Tuesday. “Partnerships of state-controlled and private oil companies are needed, but the way to cooperate hasn’t been invented.”

BP’s Russian venture lost a court case Monday over its license to mine a Siberian gas deposit with enough fuel to supply Asia for five years, allowing Russia’s government to regain control of the field as early as this week. Petroleos de Venezuela, Venezuela’s state-run oil company, said on May 14 that it plans to take control of 18 oil rigs currently operated by multinational corporations in order to reduce drilling costs.

The APEC ministers will also encourage member nations to ensure sufficient investment in refinery capacity to meet demand, to facilitate freer trade of oil products and to develop contingency plans in the event of disruptions to supplies, the draft says. Members should also promote energy-efficient transport and alternative fuels, improve energy efficiency and develop cleaner energy technologies, it said.

To help mitigate greenhouse gas emissions, the energy ministers will encourage the 21 member nations to set goals and develop plans for improving energy efficiency across industries. By joining forces with the International Energy Agency, an adviser to 26 oil-consuming nations, APEC will develop efficiency indicators that help all the member nations set out energy-saving plans and review progress, the draft said.

International Herald Tribune